Finance Minister George Osborne issued a dire economic warning to the British people should they vote to leave the EU.

Britain would lose at least half a million jobs within two years of a vote to leave the European Union and a fall in the value of the pound would push up inflation sharply, British Finance Minister George Osborne said on Monday.

"The shock to our economy after leaving Europe would tip the country into recession. This could be for the first time in history a recession brought on ourselves," Osborne warned.

With a month to go until Britain holds its European Union membership referendum, Osborne said workers' earnings, when adjusted for inflation, would be almost 3 percent lower in two years' time, equivalent to a pay cut worth almost US$1,160 a year for someone working full time on the average wage.

Osborne was speaking as the finance ministry published a new report on the short-term implications of an "out" vote.

Cameron gave a speech at the offices of the B&Q retail chain, a popular center for do-it-yourself home improvement, in Eastleigh in southern England. He said that leaving the EU would jeopardize Britain's recovery from the economic damage caused by the world financial crisis.

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"It would be like surviving a fall and then running straight back to the cliff edge. It is the self-destruct option," Cameron said.

A counter-campaign is being waged to encourage British voters to leave the austerity-stricken EU.

The campaign backing a British EU exit said the Treasury had consistently produced flawed reports and the latest analysis was biased as it provided nothing on the upside of leaving the bloc, nor on the potential negatives caused by a crisis in the eurozone.